Obama acknowledged the stimulus package -- which could total $750 billion or more over two years -- would make the federal government’s estimated $1.2 trillion budget deficit even worse.

But “doing too little or nothing at all” would “lead to an even greater deficit of jobs, incomes and confidence in our economy,” he said. “At this particular moment, only government can provide the short-term boost necessary to lift us from a recession this deep and severe.”

Obama proposed spending money to boost alternative-energy production, improve the energy efficiency of federal buildings and 2 million homes, computerize all medical records within five years and provide new technology for schools and new training for teachers.

The stimulus package also should include repairs to roads, bridges and schools, development of a “smart” electricity grid, expansion of broadband lines to rural areas and investments in scientific research, he said.

Obama called for a $1,000 tax cut for 95 percent of working families in order “to get people spending again.” Unemployment insurance and health care coverage should be extended to people who have lost their jobs, he said.

“Government at every level will have to tighten its belt, but we’ll help struggling states avoid harmful budget cuts, as long as they take responsibility and use the money to maintain essential services like police, fire, education and health care,” Obama said.

The president-elect also pledged to reform “a weak and outdated regulatory system so that we can better withstand financial shocks and better protect consumers, investors and businesses from the reckless greed and risk-taking that must never endanger our prosperity again.”

“No longer can we allow Wall Street wrongdoers to slip through regulatory cracks,” Obama said. “No longer can we allow special interests to put their thumbs on the economic scales. No longer can we allow the unscrupulous lending and borrowing that leads only to destructive cycles of bubble and bust. It is time to set a new course for this economy, and that change must begin now.”

House Republican Whip Eric Cantor, R-Va., said Republicans “will work tirelessly” with Obama on “serious solutions that will get our economy back on track.” But he added that Republicans will oppose “efforts to spend billions on wasteful pork-barrel projects, special interest earmarks and other nonessential items.”